Golden handshake by HCMC’s largest employer draws mixed feelings

Hoang Thi Lien, 45, is worried about her future, but she thinks it could have been worse.

She feels lucky to have received a severance pay of VND178 million (around $7,600) after working for 18 years at the footwear factory in HCMC's Binh Tan District.

When Pouyuen announced her severance package, she was "moved to tears," Lien said. She had expected to be among those laid off because of her age, as the company scaled down operations over Covid-19 impacts.

Nostalgic about her time at Pouyuen, Lien said that when she was 28, there were very few companies in her hometown in Long An Province. As a woman with no higher education, Lien had only dreamed of having a stable job. The dream came true she was hired on May 25, 2002.

Since the company provided no transportation at the time, Lien and a friend pooled money to buy a cheap motorbike. They took turns to drive more than 40 km from Long An to HCMC each day.

"I managed to build a house, and pay for my kids’ schooling partly because of Pouyuen. It is sad that I have been laid off, but I know I am luckier than many others," Lien said.

On getting her severance pay, she felt "losing my job is not so scary anymore," Lien said, adding that she intended to deposit the money in the bank, return to her hometown, find a new job or start a small grocery shop.

She would continue paying voluntary social insurance until the scheme’s 20-year threshold so she can get a pension later, Lien added.

Bich Loan, also 45, had expected to stay with the company for life, having joined it in 1999.

The native of Tien Giang Province in the Mekong Delta sank into worry as she received the news of her layoff on June 20.

"I am worried about my uncertain future. But I also felt relieved when the company announced I would receive VND200 million ($8,618) in severance pay," she said.

Loan said the Taiwan-owned shoemaker was sending the laid off workers on garden leave until August 4, meaning they would receive full pay and social insurance without going to work during this period.

Dire straits

However, Pouyuen’s decision to release to lay off almost three thousand workers has hurt many and they are in despair.

Many have taken to express their grief and anxiety on social media, especially those placed in junior positions where they cannot get significant benefits.

Nguyen Thi Tinh, 31, from the central province of Nghe An, said she only received a severance pay of VND34 million (around $1,470) after nearly six years of employment. The money is barely enough to cover some expenses for her and her 7-year-old daughter, who has been receiving medical treatment for several months.

She lamented that the company had cut her hours and her income first before laying her off.

"I am a single parent. After losing my job, I feel desperate."

Last Saturday, Pouyuen Vietnam Co. Ltd. announced it woul release 2,786 workers since Covid-19 has affected demand. Contract termination will commence on August 5, with employees allowed to remain home while still entitled to their salary.

Many laid off workers have 17-18 years of experience with the company and could access severance pay worth VND150-180 million ($6,450-$7,740), while those having worked over 20 years could get up to VND250 million ($10,740).

In addition to helping the workers find new jobs, the People's Committee of Binh Tan District proposed the City Tax Department consider their proposal to not collect 10 percent personal income tax on their severance pay.

Pouyuen Vietnam has been operating since 1996, with its main production focused on sports shoes. Currently, the company has about 65,000 employees and is Saigon's biggest employer.